In order to safeguard the Auditor’s independence and objectivity, the Barclays Group has in place a policy setting out the circumstances in which the Auditor may be engaged to provide services other than those covered by the Barclays Group audit.
A summary of the Barclays’ Group Policy on the Provision of Services by the Group Statutory Auditor (Policy) can be found below.
External auditor objectivity and independence: non-audit services
The core principle of the Policy is that non-audit services (other than those legally required to be carried out by the Barclays Group’s Auditor) should only be performed by the Auditor in certain, controlled circumstances.
The Policy sets out those types of services that are strictly prohibited and those that are allowable in principle. Any service types that do not fall within either list are considered by the Board Audit Committee (Committee) Chair on a case by case basis, supported by a risk assessment provided by management.
Under the Policy the Committee has preapproved all allowable services for which fees are less than £100,000. However, all proposed work, regardless of the fees, must be sponsored by a senior executive and recorded on a centralised online system, with a detailed explanation of the clear commercial benefit arising from engaging the Auditor over other potential service providers. The audit firm engagement partner must also confirm that the engagement has been approved in accordance with the Auditor’s own internal ethical standards and does not pose any threat to the Auditor’s independence or objectivity. All requests to engage the Auditor are assessed by independent management before work can commence. Requests for allowable service types in respect of which the fees are expected to meet or exceed the above threshold must be approved by the Chair of the Committee before work is permitted to begin. Services where the fees are expected to be £250,000 or higher must be approved by the Committee as a whole.
Details of the services that are prohibited and allowable are set out below
Services that are prohibited include:
- Design and implementation of of financial information systems
- Design and implementation of internal control or risk management services related to financial information
- *Appraisal or valuation services
- Fairness opinions or contribution-in-kind reports
- *Actuarial services
- Internal audit
- Management and Human Resources functions
- Broker or dealer, investment advisor or investment banking services
- Legal, expert and certain *tax services or personal services to persons in a financial reporting role
- Transaction-related and restructuring services.
*these may be permissible subject to compliance with certain requirements.
Allowable services that the Board Audit Committee considers for approval include:
- Statutory audit and audit related services and regulatory non-audit services
- Other attest and assurance services
- Training, surveys and software
- Risk management and controls advice
- Transaction support
- Tax compliance services
- Business support and recoveries
- Translation services.